In early June the open source search business arguably came of age when Elasticsearch closed on a $70M tranche of Series C investment funding. Elasticsearch is supported by both an open source search community and a commercial search business. In November 2012 the company received $10M in a Series A investment funding which was followed by a further $24M in a Series B funding in February 2013 -- making the total of investment funding now $104M.
Series C funding is usually seen as a substantial level of endorsement of the future of the company by the venture capital investment community. The next level, Series D, is seen as a prelude either to an Initial Public Offering or a trade sale.
To put this in perspective: Coveo has pulled in around $36M over the last few years and investments in Attivio total $42M. Intel's $740M investment in Cloudera in late March is not quite what it looks like on the surface. Also in March, BlackRock lead a $100M investment round in Hortonworks to support the development of Hadoop-based big data solutions, which might shape the future direction of the LucidWorks/Hortonworks joint venture.
Search -- in various forms -- is clearly a higher priority for the venture capital community than it seems to be for many organizations!
How to Spend $104M
The progress that Elasticsearch has already made over the last couple of years is summed up on its website as:
- Increased adoption of its three core products -- Elasticsearch, Logstash and Kibana (known as the ELK stack) -- by three times, climbing to more than 8 million total downloads
- Grown its customer base by seven times, adding Comcast, eBay, Facebook, Mayo Clinic, TomTom and Tinder to its customer roster
- Doubled its number of employees, including executives from Box, Citrix, Splunk and VMware
The company currently has just over 100 employees in nine countries. Steve Schurmann, Elasticsearch CEO, recently said in an interview with Fast Company that the company wanted the best people, regardless of location.
So where is the money going? Shay Banon, the creator of Elasticsearch, comments on the Elasticsearch site: